A wonderful opportunity for shorts

By Burgess Alexander

UK – INEPTITUDE UNCHAINED

Cameron & Osborne, neither of whom has had a proper job, nor had to meet a payroll, are engaged in taxing Britain into prosperity. V.I. Lenin predicted the destruction of the middle class by grinding it between the mill wheels of taxation and inflation. In the UK, the same goal is being accomplished by this pair, though with no observable ideology apart from their genealogical noblesse oblige.

Since the replacement a century ago in the political spectrum of the Liberals by Labour, incompetence and socialist ideology were accepted as Labour’s characteristics. The Conservatives were expected – from their background in business and the professions – to have the expertise to clean up after a Labour Government and set the country on the right path. No longer. Labour’s ideology has now been replaced by envy, though the incompetence remains, and both are now shared across the political spectrum by the new ruling class, the professional politicians. The only burgeoning industry is power generators whose bottom line is boosted by green subsidies, while defence companies sink.

EU – THREE STRIKES AND OUT

The third attempt by the Elite to create the Europe dreamt of by Napoleon, then Hitler, has again failed. The collapse, first of the Euro and then the E.U., is now in progress with the Greek politicians quietly discussing a 50% default. German taxpayers will not supply a profligate, mendacious and indolent Club Med with 3 trillion Euros to bail out French banks with 40:1 lending/asset ratios. The expectation of the financial and political aristocracy that people will do as they are told requires a Hitler, not a Rompuy. Thus banks in Euroland are great shorts.

U.S. – MARXISM IN AMERICA

President Obama is now seen as a busted flush, even by his former supporters. Jimmy Carter may have been a failed President, but he was a Churchill in comparison. Obama has caused severe damage to the U.S. economy, many think deliberately, to punish America for its long-standing exceptionalism. As the first President to bow to monarchs and apologise abroad for America, even the champagne socialists of Hollywood are now disenchanted with him and the coterie of grotesques he has appointed to his administration.

It’s interesting that the Tea Partiers ran against some establishment Republicans as well as Democrats. Big Government is terrified that the ordinary citizens may assert control by voting other than as instructed through the propaganda disseminated by the mainstream media. The emergence and meteoric rise in popularity of Fox News upset the convention by introducing “fair and balanced” news (Oh, horrors!). Even that stalwart liberal institution The New York Times – all the news that fits – is going broke.

The Beltway Establishment in Washington, the New York banks and the Federal Reserve Bank form an elite troika who look on the unelected elite in Brussels as a model; now that their plans are collapsing each desperately looks to the other for support.

U.S. corporations are sitting on seven trillion dollars – approximately 45% of the GDP – until Obama is gone. With the high certainty of the election of a Republican – ANY Republican – to replace Obama, confidently expect the beginning of the next American boom to coincide with the election in November 2012. Meanwhile, with little construction, copper looks like a strategic short.

ASIA – THE END OF EMPIRE

A little-noticed fact in China is that the Unofficial Church is booming in membership. The Communist regime seems to be oblivious to the historical fact that Christianity always increases in times of persecution. While numbers are difficult to ascertain, we can expect 15-20% of the Chinese population to be Christian by 2020, which, combined with the shortage of 160 million girls, who have been aborted, suggests that interesting changes in Chinese society may lie ahead.

The economy is not as successful as it is portrayed. Digging holes and filling them in again may differ only in scale from the Chinese practice of building cities, leaving them uninhabited, and then demolishing them, but the economic effect exhibits similar success.

Lending money to the World to buy low-quality Chinese goods is similar to taking in each others’ wash and not getting it all back. Inflation is eroding the loans, and inflation and corruption within China is causing growing unrest, evidenced by 200,000 riots in 2010. Like France in 1788, it’s not a place with a secure future.

India is looked upon as the democratic rival to China, which it may be, but, in common with China, it operates under socialism; vast corruption and no property rights to land stifle the economy. In addition, its neighbour, Pakistan, is preparing for a fifth war with India and both possess atomic weapons.

OVERVIEW

From time to time the entire world seems to fall into the same pattern in many diverse societies. This is one of these times.

The inability of socialists to understand the ‘free’ in free markets always leads them to interfere and try to exert control. Digging up the plants to improve the roots does not increase the crop. In the UK, the EU and the U.S., a socialistic urban elite is damaging the economy and cannot see that they are the problem. Meanwhile they print money, increase taxation and drive more industries to a China whose economy is unburdened by any nonsense about carbon credits.

The U.S. is in an interregnum until Obama goes. The Pound and the Euro will fall, but meanwhile, the collapse of the EU will accelerate as the disobedient European taxpayers refuse to do what they are told by Rompuy & Co.

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